Toast the New Year With These 'Boozy' Funds

Investment-wise, 2007 will be remembered as a year when fashions changed faster than at a Paris Hilton soiree.

Large-cap value, utilities, REITs, precious metals, China and large-cap growth came into and out of vogue with numbing regularity.

So to appropriately cap off 2007, we have a list of funds likely to gain and then lose popularity in just a matter of hours.

Assuming you bid adieu to 2007 at a New Year's Eve party, the mutual funds on the accompanying list might appear enticing at around 11:59 p.m. But six or seven hours later, the thought of them is likely to make you roll over in bed and beg for an aspirin.

Each of the funds in the adjoining table has more then 6% of its net assets invested in a group of alcoholic beverage stocks. The 24 selected stocks are from the Dow Jones beverage brewers index and that organization's distillers and vintners gauge, as well as other large domestic and international firms in the alcoholic beverages business.

In all, 1,386 open-end mutual funds have positions totaling $39 billion in the selected alcoholic beverage stocks. In addition, 139 exchange-traded funds hold positions with a combined value of $4 billion in the group while 41 closed-end funds hold an aggregate value of $492.6 million in the purveyors of intoxicants.

Even though Fortune Brands (FO Quote - Cramer on FO - Stock Picks) -- distributor of Calvert alcoholic beverages -- is among the stocks on the adjoining list, you will not find any socially responsible Calvert Group of mutual funds anywhere near the roster of funds holdings those stocks.

In fact, what might be accurately described as the antithesis of Calvert offerings and other socially responsible funds, the MUTUALS.com (VICEX Quote - Cramer on VICEX - Stock Picks)Vice Fund (VICEX) sits comfortably atop the open-end mutual fund section of the list with 23.77% of its portfolio devoted to the selected alcoholic beverage stocks. In addition to booze, the VICEX portfolio focuses on tobacco, gambling and the defense industry.

(The Vice Fund's manager, Charles L. Norton, is a contributor to RealMoney.)

Its largest portfolio holdings are Altria Group (MO Quote - Cramer on MO - Stock Picks) and Carolina Group (CG Quote - Cramer on CG - Stock Picks), with beverage giant Diageo (DEO Quote - Cramer on DEO - Stock Picks) not far behind.

Another concentrated play on the alcoholic beverage industry is the newly debuted (Nov. 30, 2007) FocusShares ISE SINdex Fund (PUF Quote - Cramer on PUF - Stock Picks). Besides the alcohol industry, this ETF concentrates its investments on gambling and tobacco. Its largest portfolio holdings are Bally Technologies (BYT Quote - Cramer on BYT - Stock Picks) and UST (UST Quote - Cramer on UST - Stock Picks).

Ever wondered whether alcoholic beverage stocks are consumer discretionary or consumer staple investments? The definitive answer comes from no less an authority than mutual-fund giant Fidelity; as you can see in the adjoining table, the (FDAX Quote - Cramer on FDAX - Stock Picks)Fidelity Select Consumer Staples Portfolio (FDFAX) -- note the word "staples," meaning nondiscretionary, in its name -- holds 10 of the hangover stocks, making up 7.72% of its assets.

Its largest holdings are Procter & Gamble (PG Quote - Cramer on PG - Stock Picks) and Coca-Cola (KO Quote - Cramer on KO - Stock Picks).

Fidelity isn't alone in its view. Four other funds in the table confirm that the bottle of Jack Daniels belongs on the shelf next to the extra virgin olive oil as a component of your inventory of consumer "staples" (but out of the reach of the kids, of course). With phrases like "consumer staples" or "consumer non-cyclical" embedded in their names, they leave no doubt.

FUNDS AT LEAST 6% INVESTED IN SELECTED ALCOHOLIC BEVERAGE STOCKS *
NAME, TICKER & TheStreet.com RATINGS GRADE **	NO. OF ALCOHOLIC BEVERAGE STOCKS *	PCT. OF ASSETS IN ALCOHOLIC BEV. STOCKS	VAL. OF ALC. BEV. HOLDINGS ($MIL.)	12-MONTH TOTAL RETURN (%)	3-YEAR ANNUAL RETURN (%)
OPEN-END MUTUAL FUNDS
MUTUALS.com Vice Fund (VICEX) A+	8	23.77	36.1	23.17	18.24
ING Van Kampen Glb Franch A (N/A) U	4	11.25	48.9	N/A	N/A
Van Kampen Global Franchise A (VGFAX) B+	4	11.24	273.5	11.84	15.68
Universal Inst Global Fra II (UGIIX) C+	4	11.15	20.5	2.6	12.32
MSIF Inc. Global Franchise A (MSFAX) A+	4	11.14	16.0	11.98	15.74
ICON Leisure & Consumer Staple (ICLEX) E	3	10.64	3.4	10.37	3.99
Rydex Series-Consumer Products A (RYPDX) B+	5	10.63	2.7	15.11	11.02
Oakmark Fund (The) II (OARMX) D-	4	8.43	481.8	1.56	5.96
First Inv International A (FIINX) U	3	8.31	6.5	19.17	N/A
TA IDEX MFS International Equity A (ICIAX) D-	3	7.89	2.3	14.04	16.41
AIM Leisure Fund A (ILSAX) D	6	7.88	75.2	6.81	9.96
Van Kampen American Franchise A (VAFAX) U	2	7.75	36.7	2.03	N/A
Fidelity Select Consu Staples Port (FDFAX) A+	10	7.72	37.7	25.76	17.61
MFS Inst Intl Equity Fund (MIEIX) A	3	7.61	227.6	14.59	18.79
PL Intl Large Cap Fund A (PAGGX) B+	3	7.57	7.1	13.07	17.16
USAA International Fund (USIFX) A-	3	7.44	118.9	14.12	18.43
Lazard Intl Equity Select Open (LZESX) A+	3	7.08	2.3	13.96	15.43
Symons Alpha Growth Inst (SAGIX) U	2	6.79	1.2	N/A	N/A
Phoenix Foreign Opportunities A (JVIAX) A+	3	6.13	79.9	20.51	23.97
Artisan International Value Inv (ARTKX) B+	1	6.02	102.5	4.35	16.34
EXCHANGE-TRADED FUNDS
FocusShares ISE SINdex Fund (PUF) U	6	21.40	1.0	N/A	N/A
Rydex S&P Equal Weight Consumer Staples ETF (RHS) A	4	11.48	0.9	12.22	N/A
iShares S&P Global Consumer Staples Index Fund (KXI) A+	11	9.56	6.6	23.41	N/A
WisdomTree Int'l Consumer Non-Cyclical Sector (DPN) A+	8	7.99	1.9	19.62	N/A
CLOSED-END FUNDS
Boulder Total Return Fund, Inc. (BTF) B	3	6.75	24.8	10.0	12.4
Lazard Global Total Return & Income Fund (LGI) A	2	6.48	17.2	8.5	12.9
S&P 500 Composite Total Return	5	0.52	N/A	7.72	10.09
* Of 24 selected alcoholic beverage companies. ** "U" is unrated. Source: TheStreet.com Ratings - Data as of 11/30/2007.

If the likes of Fidelity, ICON Funds, Rydex Investments, Barclays/iShares and Wisdom Tree imply that alcohol is a "staple" for consumers, who is to say otherwise?

In general, the funds on this list have given investors no cause to place ice packs to their heads. Of 23 members of the group for which 12-month performances are available, 18 have outperformed the S&P 500 total return index over the dozen months ended Nov. 30.

For the past three years, 15 of the 18 funds for which sufficient history is available have outpaced the S&P.

Of 21 funds in the group with sufficient track records (three years) to be rated, fully 11 have achieved grades from TheStreet.com Ratings in the "A" range. They are kept company by five more that earned marks in the "B" range to qualify for "buy" recommendations. One of the funds rated a "C+" for a status of "hold" while four were in the "D" and "E" ranges, which equate with "sell" recommendations.

(If you're interested in investing directly in alcoholic beverages, click here to read why champagne is getting better and here for a list of bubbly that won't leave your wallet flat.)

Before anyone becomes intoxicated by any of the funds on the list, a crucial factor that investing and imbibing in alcohol have in common should be kept in mind: caution and moderation above all.

Have a happy and very prosperous New Year!

FUND HOLDINGS IN SELECTED ALCOHOLIC BEVERAGE STOCKS
NAME	TICKER	OPEN-END FUNDS	EXCHANGE TRADED FUNDS	CLOSED-END FUNDS	VAL. OF FUND HOLDINGS ($MIL.)
Anheuser Busch Cos Inc	BUD	457	53	18	6,294.0
Boston Beer Incorporated	SAM	80	22	1	100.0
Brown Forman Corporation	BFB	191	50	7	1,316.8
Castle Brands Incorporated	ROX	9	0	0	1.2
Central Euro Distribution Corp	CEDC	112	19	2	557.1
Companhia De Bebidas Das Ameri	ABV	65	8	0	1,541.7
Compania Cervecerias Unidas SA	CU	29	1	0	28.6
Constellation Brands Inc	STZ	209	39	4	1,813.7
Diageo PLC	DEO	382	33	14	11,490.4
Fomento Economico Mexicano Sab	FMX	130	0	2	1,563.9
Fortune Brands Inc	FO	319	48	14	3,120.5
Fosters Group Limited	FBRWY	18	1	1	405.4
Heineken NV	HINKY	15	20	8	451.5
InBev	N/A	143	12	4	2,575.3
Kirin Holdings Company Limited	KNBWY	75	11	1	549.3
Lvmh Moet-Hennessy Louis Vuitt	LVMUY	152	14	4	3,046.4
Molson Coors Brewing Company	TAP	328	41	8	2,290.7
Pernod Ricard SA	N/A	111	11	3	2,824.2
Pyramid Breweries Incorporated	PMID	12	0	0	1.4
Redhook Ale Brewery	HOOK	12	0	0	3.7
Remy Cointreau SA	N/A	39	1	2	532.6
Sabmiller PLC	SBMRY	114	12	0	2,954.5
Vina Concha y Toro SA	VCO	3	2	0	12.0
Willamette Valley Vineyard Inc	WVVI	6	0	0	0.4
Totals *		1,384	139	41	43,475.2
* Number of funds holding any of the stocks (redundancies eliminated). Source: TheStreet.com Ratings.